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Aliara Corporation is considering purchasing one of two new machines. Estimates for each machine are as follows: Machine A Machine B Investment $109,000 $154,900 Estimated

Aliara Corporation is considering purchasing one of two new machines. Estimates for each machine are as follows:

Machine A Machine B
Investment $109,000 $154,900
Estimated life 9 years 9 years
Estimated annual cash inflows $26,600 $39,700
Estimated annual cash outflows $6,400 $9,800

Salvage value for each machine is estimated to be zero. Click here to view PV table. Calculate the net present value of each project assuming a 5% discount rate. (If the net present value is negative, use either a negative sign preceding the number eg -45 or parentheses eg (45). For calculation purposes, use 5 decimal places as displayed in the factor table provided, e.g. 1.25124. Round present value answer to 0 decimal places, e.g. 125.)

Net Present Value
Machine A $

Machine B $

Which project should the company choose?

Machine AMachine B

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